Amazon Files Case against CIA over $600M Contract

Amazon Web Services (AWS) made an appeal with a US federal court last Wednesday and filed a complaint against the Central Intelligence Agency (CIA). The move is to get the court’s approval to have the cloud service agreement between the two agencies to push through, which was put on hold after IBM’s protest.

The Government Accountability Office (GAO) received IBM’s protest in June, and since then the controversy kept rolling. IBM strongly contested the decision made by the CIA to award the 4-year $600 million cloud services contract to Amazon. GAO issued a recommendation with CIA to re-open the bidding to more providers to settle the controversy. This was after GAO discovered that the CIA favored the solicitation term for Amazon and rejected that of IBM claims and the others. CIA, for its part has until next month to decide whether they will accept the recommendation.

In response to this move from the GAO, Amazon let off some steam again as it filed a counter appeal with the US Court of Federal Claims. AWS strongly stated that the CIA got the best deal with its company compared to other cloud bidders. Amazon expects the response to its complaint by the 23rd of September.

“We believe strongly that the CIA got it right the first time. Providing true cloud computing services to the intelligence community requires a transformative approach with superior technology. We believe that the CIA selected AWS based on AWS’ technically superior, best value solution, which will allow the Agency to rapidly innovate while delivering the confidence and security assurance needed for mission-critical systems. We look forward to a fast resolution so the Agency can move forward with this important contract,” AWS said.

Meantime, other bidders including Microsoft and AT&T are on the lookout with IBM and Amazon for CIA’s decision on the agreement. This deal remains to be an important part of Amazon’s plan to market its cloud services with other government agencies in parts of Australia, Europe and New Zealand. Currently, Amazon runs the AWS GovCloud in various US government agencies.